Portugal Update, April 2017

Sai Vivek Kammari, Analyst, Europe [email protected] TE0014-000461 July 2017 Contents

. Executive summary . Key economic data and demographics . Key revenue, subscription, and technology KPIs . Key service provider KPIs . Country analysis . Ovum outlook . Subscription, revenue, and technology outlook dashboards . Key market movements . Ovum service provider, product portfolio, and pricing analysis . Service provider performance . Operators' multiplay services and bundling . Pricing dashboard . TV and video market outlook . New product launches and operator initiatives . Regulatory outlook . Regional market dashboard

. In 2016, Portugal's mobile subscriber base declined by 1.2% to reach 16.16 million. The three major mobile operators, namely MEO, Vodafone Portugal, and NOS, held subscriber market shares of 45.6%, 27.9%, and 26.5%, respectively. . Multiplay bundles in the Portuguese telecom market had higher penetration than those in other Western European markets. By the end of 2016, about 84% of the Portuguese population had subscribed to bundled services. . Operators are continuing to invest in fixed and mobile infrastructure. As part of its 2015 plan to roll out fiber to an additional 3 million households by 2020, MEO is rapidly spreading its fiber network in Portugal; on the mobile side, it signed an MOU with Huawei for network modernization. . The Portuguese pay-TV market is highly competitive with NOS leading the market with a share of 40.8%. The IPTV platform dominated the pay-TV market as the migration from conventional cable to IPTV continued in 2016. . Leading cable operator Nowo is negotiating a deal to get wholesale access to MEO's fiber network. The deal is the first of its kind in Portugal, and if signed will boost competition in the broadband and pay-TV segments. . There were about 3.42 million broadband subscribers at the end of 2016. Fiber broadband subscribers increased by 31.1% in 2016 to reach 1.1 million, surpassing cable subscribers. . In December 2016, ANACOM reduced fixed wholesale termination rates by 42% to increase competition in fixed telephony services. The new wholesale fixed termination price is €0.0644 per minute.

GDP annual growth forecast Statistics 2017 2.0% Population 10,419,000 1.5% 1.0% Urban population 64.2% 0.5% 0.0% % of households with broadband 87.2% -0.5% Unemployment rate 10.9% GDP growth -1.0% -1.5% Mobile penetration 157.8% -2.0% 2013 2014 2015 2016 2017 2018 2019 2020 Mean monthly mobile ARPU ($) 17.10

Source: Source: Ovum, IMF, World Bank IMF

Inflation (CPI) National debt as % of GDP 2.0% 132% 130% 1.5% 128% 126% 1.0% 124% 122% 0.5% 120% 118% 0.0% 116%

Inflation (local currency) 114% -0.5% Nationaldebt as % of GDP 112% 2013 2014 2015 2016 2017 2018 2019 2020 2013 2014 2015 2016 2017 2018 2019 2020

Source: IMF Source: IMF

QoQ change, 4Q16 Statistics 2Q16 3Q16 4Q16 (%) Total subscriptions: 24,366,346 24,717,225 25,055,504 1.4 Mobile 16,687,287 16,932,630 16,947,966 0.1 Fixed broadband 3,199,011 3,261,171 3,325,957 2.0 Fixed voice 4,480,048 4,523,424 4,781,581 5.7 Total revenues ($m): 1,711 1,719 1,669 -2.9 Mobile 947 960 934 -2.7 Of which voice 399 416 380 -8.7 Fixed 764 759 735 -3.2 Mobile ARPU ($): 9.77 9.98 9.35 -6.3 Postpaid share of total subs (%) 50.0 49.9 50.5 0.6* 3G/4G share of total subs (%) 61.7/25.8 60.0/28.3 58.5/30.4 2.6/6.9 Operator mobile capex ($m) 990 206 299 45.2

* percentage points Source: Ovum

Last reported quarter Vodafone Portugal MEO NOS

Total revenues ($m): 261.61 579.71 386.75 Fixed revenues ($m): 64.74 377.24 236.62 Fixed broadband subscriptions (000s) 538 1,403.99 1,289.50 Market share (%) 15.95 41.64 38.24 Net subscription additions 33,779 3,692 20,000 FTTx net additions 15,990 31,000 1,100 FTTx market share (%) 16.5 71.2 11.7 Mobile revenues ($m) 196.87 202.47 150.13 Mobile subscriptions (millions) 4.72 7.73 4.49 Market share (%) 27.86 45.64 26.50 Net subscription additions (000s) -62 12 31 LTE additions (000s) 100.8 197.3 99.2 LTE market share (%) 25.5 48.7 25.8

Note: See WCIS for latest data sets Source: Ovum

7 Ovum | TMT intelligence | informa Copyright © Informa PLC Ovum country outlook: Portugal Key market statistics Mobile subscription growth, 2016–21: 0.2% Fixed broadband subscription growth, 2016–21: 3.7% TV subscription growth, 2016–21: 2.0% Market dynamics Portugal's mobile penetration currently stands at 157.2%. Given the already high penetration, Ovum expect Portugal's mobile subscribers to grow marginally, at 0.2%, over the next five years to reach 16.3 million by end-2021. Multiplay bundles are the most popular products in the Portuguese telecom market, and the demand for bundles continued to grow in 2016. By end-2016, bundled subscribers reached 3.51 million and penetration 84%. Quintuple- play (5P) services (fixed voice, fixed broadband, TV, mobile telephony, and mobile broadband) lead the segment with 1.44 million subscribers, followed by triple-play services with 1.42 million subscribers. Increasing adoption of converged service contracts is pushing operators toward attaining a stable mobile subscriber base. Prepaid mobile subscribers continued to decline and fell below postpaid subscribers for the first time in June 2016. Further, the revenues from fixed voice services saw positive trends as fixed voice subscribers grew significantly because of the rapid increase in users opting for integrated services . Fixed telephony penetration reached record levels of 46.3% by end-2016 – the growth was primarily driven by a 16.9% increase in VoIP subscribers over fiber and cable networks. Intensifying competition in the multiplay segment is driving operators to increase the data allowances in various bundles and enrich their multiplay bundles, complementing them with value-added services. For instance, Vodafone increased mobile data allowances by about 300% for its packages (TV+Net+Voz+Movel+Internet Movel , TV+Net+Voz, TV+Net+Voz+Movel); a similar approach was adopted by MEO, which increased mobile data allowance for its M4O and M5O packages. 8 Ovum | TMT intelligence | informa Copyright © Informa PLC

Ovum country outlook: Portugal (contd.)

In Ovum's view, NOS will try to improve its market share in multiplay bundled services and attempt to surpass Altice Group (MEO). NOS's continuous development of its popular Iris platform and launch of other applications such as NOS Share, which are focused on delivering content on multiple devices, will catalyze NOS's growth. Technology migration and availability, 3Q16 Number of LTE connections: 4,794,283 LTE connections growth in the past year: 94% FTTx connections: 1,014,239 By end-2016, 3G and 4G accounted for 90.9% of mobile connections. We expect LTE to account for 86.5% of connections by end-2021, driven by operators' ongoing and planned investments in the advanced LTE networks. By end-2016, FTTx evolved as the leading broadband technology in Portugal, surpassing cable. Operators are adopting new technologies to deliver better speeds and hit the national target; furthermore, MEO intends to replace its entire copper network with FTTH by 2020. Currently, 5.1million households are passed by FTTH/B and 4.25 million by Docsis 3.0 networks. Incumbent MEO is the only operator with significant NGN coverage in rural areas, as it continues to expand its fiber optic network to new localities, aiming to pass 5.3 million households by 2020. Additionally, ANACOM's decision not to compel MEO to open its rural fiber optic network to other operators despite the EC's recommendations enables MEO to continue its strong hold in the rural market. M2M development: Compared with its peers, Portugal lags in M2M development. Operators are gradually shifting focus toward enterprise services and IoT/M2M solutions to drive revenue growth. MEO plans to launch new M2M solutions through partnerships with Sigfox and Narrow Net. NOS launched NB-IoT network using Huawei infrastructure and tested smart meters that work on 4.5G NB-IoT technology. 9 Ovum | TMT intelligence | informa Copyright © Informa PLC

Portugal subscription outlook dashboard

FIXED MOBILE TV (Source: WBIS) (Source: WCIS) (Source: WTVIS) DISRUPTORS

Broadband market share, 2017 Mobile market share, 2017 Multichannel TV share, 2017 OTT VoIP connections (active users) 8 PT Portugal 38.11% MEO Portugal 46% NOS 39.5% 6 Zon Multimedia 37.45% Vodafone Portugal 28% MEO 32.0% 4

Vodafone Portugal 14.91% Vodaf one 14.6% Millions NOS 26% 2

Other 9.53% Other 0% Other 14% 0 2016 2017 2018 2019 2020 Fixed Mobile 2017 subscriptions: 3,618,800 2017 subscriptions: 16,199,070 2017 subscriptions: 3,739,086 Growth vs 2016: 5.9% Growth vs 2016: 0.3% Growth vs 2016: 2.8%

Broadband subs forecast Mobile subs forecast Pay-TV subs forecast MVNO subs forecast 5 20 5 1 4 15 4 1 3 3 10 0 2 2 Millions Millions Millions 1 Millions 5 1 0 0 0 0 0 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019

. By end-2016, Portugal had 3.42 million fixed broadband subscribers. MEO was the market leader with a share of 40.5%, followed by NOS with 36.9% and Vodafone with 14.3%. . Portugal had 3.64 million TV subscribers at the end of 2016. Ovum expects TV subscribers to grow at a CAGR of 2.0% over the next five years to reach 4.02 million subscribers.

FIXED MOBILE TV OTT VIDEO and MOBILE ARPU (Source: WBIS) (Source: WCIS) (Source: WTVIS) OUTLOOK

Broadband revenues by type, Service revenues by type, 2017 Pay-TV revenues by type, 2017 OTT video revenues ($m) 2017 80.0 Cable 18% Cable 37% 60.0 Voice 42% DSL 35% DTH 17% 40.0 FTTH/B 39% DTT 0% Data 58% 20.0 Other 8% IPTV 46% - 2017 revenues: $990m 2017 revenues: $3,489m 2017 revenues: $1,262m 2016 2017 2018 2019 2020 Growth vs 2016: 10.93% Growth vs 2016: 2.81% Growth vs 2016: 4.45%

Broadband revenues ($m) Service revenues ($m) Pay-TV revenues ($m) Mobile ARPU ($)

1,000 3,000 1,000 15.00

2,000 10.00 500 500 1,000 5.00

- - - - 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 Cable DSL Cable DTH Voice Data FTTH/B Other Voice Data DTT IPTV . Mobile data revenue continued to be the major contributor toward mobile service revenue in 2016. Mobile data revenue's contribution increased by 3.2 percentage points to 53.8% in 2016, in line with the growing usage of OTT voice and messaging services. In 3Q16, mobile phone users making voice calls using internet increased to 26%. . Revenues from OTT video services are expected to grow by more than 200% to €79m over the next five years. 11 Ovum | TMT intelligence | informa Copyright © Informa PLC Portugal technology outlook dashboard

FIXED MOBILE TV SMARTPHONE and (Source: WBIS) (Source: WCIS) (Source: WTVIS) M2M OUTLOOK

BB subscriptions by type, 2017 Mobile subscriptions by type, Pay-TV subscriptions by type, Smartphone connections 2017 2017 15 FTTx 35.88% W- CDMA 50% IPTV 50% 10 Cable modem 29% LTE 44% Cable/MMDS 34%

Millions 5 xDSL 27% GSM 7% DTH 16% 0 Other 7% Other 0% Other 0% 2016 2017 2018 2019 2020 2021

Broadband subscriptions Mobile subscriptions Pay-TV subscriptions M2M connections 2 20 4 1,200 1,000 1 10 2 800 600 Millions Millions Millions 400 0 0 0 Thousands 200 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 0 FTTH/B Cable W- CDMA LTE IPTV Cable/MMDS 2016 2017 2018 2019 2020 2021 DSL Other GSM Other DTH Other . Portugal had 7.3 million smartphone devices at end-2016, and population penetration stood at 68.8% at end-3Q16 . Smartphones in Portugal will grow at a CAGR of 11.7% to reach 12.6 million by 2021 as operators continue to strongly promote smartphones, bundling them with huge data packs. . Retailers are launching innovative offers, pushing smartphones into the market at cheaper prices and contributing positively to the proliferation of smartphones. For instance, Phone House, a telecom retailer, launched first-of-its- kind smartphone rental services in Portugal, allowing users access to high-end smartphones at cheaper prices. 12 Ovum | TMT intelligence | informa Copyright © Informa PLC Portugal – key market movements

-1.5% -1.0% -0.5% 0.0% 0.5% 1.0% 2016–17 net additions

1 MEO Portugal 1.5% growth 109,294 actual change 2016–17 2 NOS -0.7% growth -28,822 actual change 2015–16

growth 3 Vodafone Portugal -0.8% growth -36,768 actual change MOBILE subscription 2014–15 4 growth #N/A actual change

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 2016–17 net additions 1 MEO Portugal 6.7% growth 401,740 actual change 2016–17 2 NOS 5.5% growth 169,728 actual change 2015–16

growth 3 Vodafone Portugal -1.1% growth -41,146 actual change 3G & 3G & LTE subscription 2014–15 4 growth #N/A actual change

-2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 2016–17 growth 1 Total ARPU -0.1% growth -0.01 actual change 2016–17 2 Mobile voice ARPU -9.7% growth -0.77 actual change 2015–16

ARPU 3 Mobile data ARPU 8.3% growth 0.76 actual change

MOBILE 2014–15

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 2016–17 growth 1 Fixed voice subscriptions 2.6% growth 117,495 actual change 2016–17

voice 2015–16 growth FIXED

subscription 2014–15

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 2016–17 net additions

1 Zon Multimedia 7.4% growth 93,700 actual change 2016–17 2 Others Portugal 37.1% growth 58,500 actual change 2015–16 3 Vodafone Portugal 10.5% growth 51,300 actual change growth FIXED broadband

subscription 2014–15 4 Cabovisao 1.7% growth 2,200 actual change

0% 5% 10% 15% 20% 25% 30% 35% 2016–17 net additions

1 Zon Multimedia 20.0% growth 76,000 actual change 2016–17 2 Others Portugal 42.7% growth 59,200 actual change

FTTx 2015–16

growth 3 PT Portugal 9.6% growth 47,700 actual change

subscription 2014–15 4 Vodafone Portugal 15.8% growth 13,900 actual change

Service provider financial performance, 3Q14–16

. Service provider financial performance . Despite the reduction of SMS and voice MTRs, operators managed to register positive revenue growth in 3Q16, owing to the positive trends in the consumer segment. In 3Q16, NOS's telco revenue grew by 4.1% year on year to $402.8m, fueled by strong growth in consumer revenues. . PT Portugal accelerated its fiber rollout during 2016, resulting in a surge in its network investments. . Key technology deals by service provider . In February 2017, Altice Labs and Ericsson signed a memorandum of understanding to conduct joint research on 5G technology and develop understanding of 5G uses cases. The collaboration focuses on setting up a 5G laboratory in Aveiro (Portugal), conducting 5G field tests, and framing 5G requirements and network deployment scenarios. 15 Ovum | TMT intelligence | informa Copyright © Informa PLC Operators' multiplay services and bundling

Fixed Mobile Wi-Fi Provider Fixed voice TV Mobile voice broadband broadband hotspots PT Portugal xDSL, FTTx, PSTN DTH, IPTV HSPA, LTE GSM, W-CDMA, Yes LTE, satellite LTE

NOS Cable, FTTx, Cable Cable, DTH, HSPA, LTE GSM, WCDMA, Yes LTE telephony IPTV LTE

Vodafone Portugal xDSL, FTTx PSTN (CPS, IPTV HSPA, LTE GSM, WCDMA, Yes WLR) LTE Nowo Cable Cable Cable Yes Yes No (Apax Partners) telephony

Source: Ovum . Quintuple-play services are gaining popularity in Portugal. Its subscriber base (1.39 million) surpassed that of triple-play services (1.38 million) in 3Q16. . Competition in the Portuguese telecom market is intense as all the major operators offer converged services. MEO was the market leader in the bundled services segment with a market share of 39.7%, followed by NOS (39.3%), Vodafone (15.9%), and Nowo (5.0%). However, Vodafone added the most number of subscribers to its bundles during 2016, owing to its acquisition of Optimus FTTH network.

. ANACOM, Portugal's telecom regulatory body, introduced the framework for MVNO operations in 2007. Portugal's first MVNO, Correios de Portugal SA (CTT), was launched at the end of 2007, followed by ZON Multimedia in 2008. . Cabovisao and Oni, which are now part of Apax France, were granted MVNO licenses in November 2015 and launched their commercial operations in April 2016 in partnership with PT Portugal. Cabovisao and Oni were part of Altice Group earlier and were sold by it during the acquisition of PT Portugal. . Cabovisao rebranded as "Nowo" in September 2016. It envisions an improvement in its market penetration under the new brand, combining its existing portfolio of cable- based triple-play services with the newly launched mobile services. . Benfica Telecom, Continente Mobile, Dragao Mobile, Lycamobile, Moche, Phone-ix, UZO, Vectone Mobile, and Yorn are few of the major operating MVNOs in the Portuguese mobile market.

Primary connections: 3,434,988 (pay) Total TV connections: 4,342,370

The biggest year-on-year gains in multichannel-TV subscribers count came from Vodafone with net additions of 99,000, followed by MEO with 25,000. Vodafone's subscriber growth is primarily driven by its content-enriching initiatives. Vodafone established itself as Portugal's first 4K services provider through the launch of channels such as Funbox 4K UHD and Insight TV UHD, and the launch of a 4K UHD set-top box. The top two operators, NOS and MEO, together hold a market share of 70.3%. NOS's continued focus on penetrating new households and its strong marketing campaigns ensure its market leading position in Portugal's TV segment. Multichannel-TV market share by operator, 3Q16

Zon Multimedia 36.7%

PT Portugal 33.6%

Others Portugal 20.9%

Cabovisao 4.8%

Vodafone Portugal 2.8%

Sonaecom 1.3%

Source: Ovum

Portugal is a very dynamic market when it comes to pay TV and video services, and there are many opportunities for OTT service providers. With rising SVOD subscriptions, major operators have started offering value-added services in addition to their traditional TV services. Portuguese cableco Nowo, formerly Cabovisao, started to deliver OTT multiscreen services in Portugal using Broadpeak's equipment. OTT service providers' focus on expanding the content catalog has also increased significantly. Netflix, which launched its services in Portugal collaborating with Vodafone, has increased its content considerably from the time of launch; furthermore, it is now signing deals with local content producers to expand its product catalog. Portugal: Availability of live OTT content TV on Parent company Parent company type Brand Movies Linear TV Live sport demand Amazon Online retailer Amazon Prime Instant Video Yes Yes No No TV Tokyo, Chernin Group Broadcaster Crunchyroll Yes Yes No No Discovery Communications Broadcaster Eurosport Player No Yes Yes Yes BBC Worldwide Broadcaster Global iPlayer No Yes No No Apple Consumer technology iTunes Yes No No No ITV Broadcaster ITV Essentials No Yes No No Mubi Online video MUBI Yes No No No United Group Telecoms operator Net TV Plus No Yes Yes Yes AMC Telecoms operator Machinima Yes Yes No No Netflix Online video Netflix Yes Yes No No Google Internet firm Play Yes No No No Sony Consumer technology PlayStation Network Yes Yes No No 19 Ovum | TMT intelligence | informa Copyright © Informa PLC New product launches

. More than half of Portugal's telco service launches in 2015 and 2016 were concentrated in two primary areas: infotainment and TV/video. . There has been a significant increase in the focus on enterprise security and infotainment services. . In September 2016, Vodafone Portugal launched Security Operations Centre (SOC) and Secure Anti DDoS (Distributed Denial of Service) as enterprises are becoming more vulnerable to cyber-attacks.

20 Ovum | TMT intelligence | informa Copyright © Informa PLC Case study: Vodafone launches enterprise security products – Security Operations Centre (SOC) and Secure Anti DDoS (Distributed Denial of Service)

Event summary Significance Uniqueness

In September 2016, Vodafone launched two new security products: Security Operations Centre (SOC) and Secure Anti DDoS (Distributed Denial of Service). Through these services, Vodafone ensures uninterrupted internet connectivity for enterprises that heavily depend on it and minimizes the risk of cyber-attacks by Country Telco continuous monitoring of the networks. Cybersecurity events in the enterprise's network are monitored, analyzed, and managed 24×7 by a dedicated team of experts.

•Further reading: http://negocios.vodafone.pt/vodafone-secure/default.html

Insight Partners

SOC and Secure Anti DDoS offer high-value services such as real-time threat detection and incident management advice. These allow organizations to n/a optimize their network usage, and minimize their cost and business losses, especially for enterprises that rely on its network for sales and services. Target market This move stands as an excellent example where network operators target the business segment, addressing the most important issue of cybersecurity. Enterprise Vodafone Portugal has beefed up its enterprise security product portfolio at a time when most of the companies are considering cyber-risk as a top issue to Market segment be addressed. The number of Portuguese enterprises encountering cyber- attacks has increased rapidly. Fixed/mobile > Enterprise > Security > Security

Case study: Portugal Telecom's internet arm Sapo launches "Sapo Viagens" service

Event summary Significance Uniqueness

In April 2016, Portugal Telecom's internet arm Sapo launched "Sapo Viagens" services in partnership with the largest travel site in the world, TripAdvisor. The portal integrates TripAdvisor's content and functionality with travel experiences, opinions about various tourist destinations shared on the Web by Country Telco various bloggers, travelers, and journalists. Additionally, the portal also provides complete information about tourist destinations, assisting the users in financial planning and scheduling the trip. •Further reading: http://viagens.sapo.pt/

Insight Partners

The Portuguese tourism industry is growing at a brisk pace (grew 9.3% in 2015). TripAdvisor The percentage of people using digital tools pre- and post-travel for planning and sharing experiences has gone up to 95% in 2015, as per the World Tourism Target market Organization's data. Increased adoption of mobile broadband and proliferation of smartphones can be cited as the prime reason for this trend. Consumer Sapo Viagens is designed to drive revenue growth, tapping the increased usage of digital services in the tourism industry. It is an excellent example of Market segment telecommunication companies collaborating on various services to launch innovative platforms, providing end-to-end travel services. Fixed/mobile > Consumer > Application store/portal > Travel

Case study: NOS launches "NOS Share" application, enabling users to store and share content

Event summary Significance Uniqueness

In September 2016, NOS Portugal launched the "NOS Share" application, which allows users to store videos, photos, and other files in the cloud and share them across all devices. Customers are offered a cloud storage space of 16GB to store and manage content, and they have the provision to save contacts, create groups, Country Telco and create folders in the given storage space. They can share the content with single or multiple contacts on smartphones, tablets, and computers at one go. NOS Share is currently available to all UMATV multidevice subscribers. •Further reading: http://www.nos.pt/particulares/televisao/nos- share/Pages/default.aspx#Share

Insight Partners

The Portuguese pay-TV market is highly competitive. At the end of 3Q16, NOS n/a was the largest TV operator in Portugal's pay-TV market. With the focus on strengthening its position further in the pay-TV market, NOS has been working on upgrading its current services with various value-added features. Target market The NOS Share app is aimed at enhancing customer experience of its most Consumer popular UMATV multidevice services. It gives NOS an extra edge to upsell its higher-value service options, NOS 4 and NOS 5, to its existing customer base. Market segment

Fixed/mobile > Consumer > TV/video > TV > App

Topics Current status Digital Agenda ANACOM and the government jointly introduced the Digital Agenda for Portugal in December 2012. Following are some of the major objectives: 1) To promote the development of broadband infrastructure, so that citizens have access to broadband speeds of 30Mbps or more by 2020 and 50% of households have access to broadband with speeds of 100Mbps or more by 2020. 2) To create conditions enabling an increase of 50% (compared with 2011) in the number of businesses using e-commerce in Portugal by 2016. Licensing In February 2016, ANACOM renewed the rights to use frequencies in the 2.1GHz spectrum band for operators NOS, MEO, and Vodafone for a period of 15 years. Under the terms of the license, the three operators are obligated to cover 588 parishes with mobile broadband services, with each operator covering 196 parishes. Net neutrality The Telecommunications Act of September 2011 has clear provisions to help ensure the neutrality of communications networks. With regard to this, the 2011 law focuses on three key areas: transparency, traffic management, and quality of service (QoS). To prevent the hindering or slowing of traffic, the national regulatory authority has set minimum QoS requirements for operators, which are now obligated to publish in their contracts information about any procedures in place to shape traffic or mitigate network congestion. Mobile termination Mobile voice termination rates were lowered to 0.85 euro cents per minute – a reduction of rates 35% versus the price at the end of 2012 (1.27 euro cents). In July 2016, voice termination rates were further reduced to 0.81 euro cents per minute. Source: Ovum 25 Ovum | TMT intelligence | informa Copyright © Informa PLC Contents

Note: Figures are analyst forecasts for end-2017. Source: Ovum . At the end of 2016, Portugal's fixed broadband household penetration was 83.2%, compared with Western European broadband penetration of 80.6%. We expect 95.6% of Portugese households to have fixed broadband access by the end of 2021. . Portugese fixed fast broadband development outperformed the Westren European avergae by 28.4 percentage points, while mobile fast broadband development lagged by 2.2 percentage points.

Further reading Regional data pack: https://www.ovumkc.com/Products/Service-Provider/Europe

Country data pack: https://www.ovumkc.com/Products/Service-Provider/Europe/RDS/Portugal/Portugal

Broadband Development Index: https://www.ovumkc.com/Products/Service-Provider/Broadband-Development- Index

World Telecoms Information Service: https://www.ovumkc.com/Products/Service-Provider/World-Telecoms- Information-Service

Author Sai Vivek Kammari, Analyst, Europe [email protected]

Ovum Consulting We hope that this analysis will help you make informed and imaginative business decisions. If you have further requirements, Ovum's consulting team may be able to help you. For more information about Ovum's consulting capabilities, please contact us directly at [email protected].

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